Announcement

Collapse
No announcement yet.

German Economy Booming

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • #61
    ^^^ It can't hurt when your CEO is Obama's Windmill Czar....
    "We will go through our federal budget – page by page, line by line – eliminating those programs we don’t need, and insisting that those we do operate in a sensible cost-effective way." -President Barack Obama 11/25/2008

    Comment


    • #62
      So historically, what rate has Germany typically come out of recessions?

      Is 3.6% growth higher than normal?
      "We will go through our federal budget – page by page, line by line – eliminating those programs we don’t need, and insisting that those we do operate in a sensible cost-effective way." -President Barack Obama 11/25/2008

      Comment


      • #63
        The 3.6% growth rate is basically just recouping the one-year recession - just sticking the growth of two regular years into one year. If there had been no recession, the growth rate in comparison to 2007/08 would have been just as high.

        Comment


        • #64
          So that means it's booming? That's what I am trying to figure out.

          We've come out of recessions at 6% in the past- I was trying to figure out if Germany's growth is a typical post-recession rate, or if it's something exceptional.
          "We will go through our federal budget – page by page, line by line – eliminating those programs we don’t need, and insisting that those we do operate in a sensible cost-effective way." -President Barack Obama 11/25/2008

          Comment


          • #65
            Depends on the timeframe you look at. Compared to the recession of 1975 the numbers are not unusual, but if you only look at the unified Germany they are quite good. Actually the current growth rates are among the highest since 1990.

            Comment


            • #66
              Originally posted by highsea View Post
              We've come out of recessions at 6% in the past- I was trying to figure out if Germany's growth is a typical post-recession rate, or if it's something exceptional.
              Germany suffered a minus 4.7% recession in 2009. The 3.6% plus we had in 2010 may seem exceptionally high, but it's just recouping that recession - it's effectively the "normal" growth for 2009 and 2010 rolled into one year. One could speculate on why the 2010 growth had that "two-for-one" special. The most likely cause is simply that the markets Germany exported to exploded in a temporary post-recession bubble. Domestic demand definitely didn't change. The projected growth for 2011 at 1.5% though is far more normal and pretty much standard for the past two decades, so it's not really a persistent boom.

              Regarding the unification factor Tarek is alluding to - the recession actually showed quite well where the economic might of Germany lays. That is in the South, where we had recessions of -6% to -10% going by states during 2009 that we're right of booming away from. The eastern states that don't produce anything didn't really go through a recession in 2009 - Berlin actually managed a GDP growth that year. Of course as a second result of this split it's now only the southern states that are recouping - the eastern states at a total +1.1% in 2010 are only experiencing regular, almost subpar growth.

              Comment


              • #67
                the projections have for 2011 have been upgraded to 2,7% and, at least for now, the numbers are getting corrected upwards (of course this is, as any projection, still not a fixed number and will change)

                Comment


                • #68
                  Only in PPP, not nominal. It also depends on who you ask - 2.7% is the prognosis of IMK; numbers bounce around wildly, KfW even expects a 3.0% growth. DIW does 2.1 to 2.2% (and that's the only prognosis the government is supporting), IfW expects 1.7%.

                  Effectively it's riding out that bubble and adjusting for the fact that the US Economy is crap right now and was overstated a lot immediately post-recession. German Exports will rise by 10% during 2011, but only by 6.5% in 2012.

                  Comment


                  • #69
                    A question to all Germans? How do you do it?! Why are you so good at making products so many people want? what is it in the German system that makes it so effective, is it education? or something else? Germany is the nation everyone should look up to, whatever you do is how to do it!

                    Comment


                    • #70
                      what is it in the German system that makes it so effective, is it education?
                      Actually our education system has quite many flaws, the only area where it does seem to do rather ok is the training of skilled labour. At least German manufactures (like car makers) usually complain about not being able to find (good enough) trained workers in the U.S. for example and often have to spend two or three years in getting them up to speed.

                      Why are you so good at making products so many people want?
                      To a degree this is a self-fulling prophecy. Because people expect German products to be of high quality they are often willing to pay high prices for it..and because they do that we can produce high quality products in the first place. Also keeping a large industrial base is something heavily favoured by the politics (and public) in contrast to becoming a service and finance oriented economy like the UK.

                      How Germany got into that situation in the first place? Well that is actually (to a degree) your "fault". About 130 years ago the UK passed a law that all imported German products had to be labed with "made in Germany" to protect British buyers from cheap German knock-off products (which, at that time, many were). But, shortly after this was introduced, the quality of the "cheap German knock-offs" increased quickly and they became very popular in the British Empire. Instead of a warning it became label associated with quality and was the foundation for reputation German products still have today..so...Thank you very much.

                      (Of course there are many more reasons and this is very simplified, but I just kind of love the unintentional consequences of said British actions back then)

                      Comment


                      • #71
                        Originally posted by kato View Post
                        Germany suffered a minus 4.7% recession in 2009. The 3.6% plus we had in 2010 may seem exceptionally high, but it's just recouping that recession - it's effectively the "normal" growth for 2009 and 2010 rolled into one year. One could speculate on why the 2010 growth had that "two-for-one" special. The most likely cause is simply that the markets Germany exported to exploded in a temporary post-recession bubble. Domestic demand definitely didn't change. The projected growth for 2011 at 1.5% though is far more normal and pretty much standard for the past two decades, so it's not really a persistent boom..
                        Right.

                        If we had 1.5% as our expected normal, we'd freak out. We want to come out of recessions at 6% and stabilize at 3%.

                        But the moneychangers misjudged this one...
                        "We will go through our federal budget – page by page, line by line – eliminating those programs we don’t need, and insisting that those we do operate in a sensible cost-effective way." -President Barack Obama 11/25/2008

                        Comment


                        • #72
                          Sorry if this is a digression about the issue being discussed but I read 1 story and 2 editorials in a span of a week about how Non-Union workers are slowly climbing in a steady rate in in Germany and this is one of the primary reasons for the economy doing well.

                          True? False? Doesn't matter?

                          Comment


                          • #73
                            Originally posted by YellowFever View Post
                            Sorry if this is a digression about the issue being discussed but I read 1 story and 2 editorials in a span of a week about how Non-Union workers are slowly climbing in a steady rate in in Germany and this is one of the primary reasons for the economy doing well.

                            True? False? Doesn't matter?
                            Same thing is happening here in the US. Businesses are flocking to Right-To-Work States (in the South), and we seem to be doing well.

                            Comment


                            • #74
                              Originally posted by highsea View Post
                              Right.

                              If we had 1.5% as our expected normal, we'd freak out. We want to come out of recessions at 6% and stabilize at 3%.

                              But the moneychangers misjudged this one...
                              These numbers are though are only for post-reunification and for the most time the new states did drag these numbers down quite a lot. There is still a lot of catching up to do (and some regions are simply dying due people moving away) but they are catching up. Also as mentioned earlier it looks like the actual growth for 2011 will be quite a bit higher than 1,5% (possible even twice as high according to the more optimistic forecasts).

                              Also, in general our booms are smaller than those of the US, but so are our recessions. I guess it is mostly a question of personal preference if you prefer boom & bust or "slow n steady". Further traditionally the US economy seems to be based on a huge part on private consumption and that people often spend much more than they actually could afford, while here saving up money is more the norm (the saving ration for personal households in Germany is than 5 times as high than in the US).

                              Comment


                              • #75
                                Originally posted by YellowFever View Post
                                Sorry if this is a digression about the issue being discussed but I read 1 story and 2 editorials in a span of a week about how Non-Union workers are slowly climbing in a steady rate in in Germany and this is one of the primary reasons for the economy doing well.

                                True? False? Doesn't matter?
                                I guess that they refer mostly to temp-workers who are indeed on the rise in Germany (or rather an area where Germany is catching up to others). The option they give companies to quickly bolster the workforce without committing to long time expenditure is indeed a factor, but most likely not nearly as big as those articles you mentioned make it look (of course, without knowing them I can not really say for certain). But in the long run most manufactures prefer a regular, trained & skilled workforce and use temps only as a stop-gap or temporary projects (but of course, as always, there are exceptions, especially if the work is rather simply and the people are easily replaceable)

                                One of the biggest pillars of the German Economy for example is the car industry and their unions are quite strong and influential, yet almost all our big car producers are thriving regardless. Unions are much less demonized in Germany than they seem to be in the US at the moment, but also seem to be much more flexible and willing to at make (at least temporary) sacrifices if the company falls on hard times.

                                To give a shorter answer:
                                Partly true, but a much more minor reason compared to others.

                                Comment

                                Working...
                                X